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Omnivore plans second Indian agtech fund

The early stage company-focused fund should be fully deployed by 2017, while the launch of a second fund is expected in mid-2016.

Omnivore Partners has deployed more than two thirds of its 2.6 billion rupees ($38 million; €38 million) fund focused on early-stage Indian agtech companies and plans to launch a second fund in mid-2016 targeting $70 million, an executive told Agri Investor.

Omnivore’s first fund is expected to deploy its remaining committed capital, around 25 percent of the total raised for its 2013 final close, by the end of the year with most or all of the remaining funds going to existing investments, founding partner Mark Kahn said.

“We may do one new investment in Fund I, but the focus is primarily on follow-on rounds,” he said.

Although the Indian agricultural sector has faced falling output from two droughts and low commodity prices, Kahn said Omnivore’s niche strategy has largely insulated it from the negative trends facing many producers.

“Thankfully Omnivore portfolio companies have largely been unaffected,” he said, adding that the fund was careful to tap into India’s growing needs. “The stress is creating opportunities for new technology solutions that many of our portfolio companies are working on.”

Y-Cook, for example, which provides what Kahn describes as flash-cooked, shelf-stable food, is one way to bring fresh food to consumers through a poor supply chain.

“In the case of Y-Cook, the absence of cold chains for fresh produce combined with the Indian consumer habit of avoiding raw vegetables created a unique opportunity,” he said. Forty percent of fruits and vegetables in India are wasted, according to a 2013 Ernst & Young and the CII Institute of Logistics report.

Omnivore also invested in Eruvaka, which makes aquaculture technology to enable farmers to check on and control their ponds remotely.